- WalletHub report says new-car financing rates are at their lowest point in 3 years
- Firm says low rates are best from automakers and especially apply to drivers with good credit
- WalletHub also released a list of the harshest and most lenient states for high-risk drivers
A new Labor Day report from analysts at WalletHub suggests that car financing is getting cheaper. The firm’s report notes that interest rates for new-car loans are reaching their lowest point in the last 3 years — especially for drivers with good credit.
The new report also notes a few other important car-financing tips, such as the fact that drivers with good credit pay out a substantially smaller amount over the course of a loan than drivers with bad credit. The firm says that shoppers with bad credit pay a whopping $6,100 in additional interest payments over the life of a $20,000 loan for 60 months than drivers with good credit.
Additionally, WalletHub’s report named the top places for drivers to begin their search for new-car financing. While we often recommend credit unions, WalletHub says the best place to start the financing search is actually car manufacturers, whose impressive incentives have resulted in interest rates that are 61 percent below the national average. Credit unions come in second, with rates that are around 30 percent below the national average, while national and regional banks offer rates at 10 percent and 43 percent above the average, respectively.
WalletHub’s Labor Day update also took a look at states with the harshest and most lenient penalties on high-risk drivers by comparing DUI laws, insurance premiums and driving penalties from various states. According to the firm, the strictest states are Arizona, Alaska, Virginia, West Virginia and Delaware, while the most lenient are South Dakota, Pennsylvania, Montana, North Dakota and Michigan.
What it means to you: WalletHub’s latest report suggests that now is a good time to finance a new car — especially if you pick a brand-new model and finance through an automaker or a credit union.